Boston Scientific (Natick, Massachusetts), a company that has been beset by a variety of problems lately, received a large piece of good news yesterday from a unit that has caused much of its problems.
The company reported that the FDA lifted restrictions from a warning letter following the agency's re-inspection of one of its plants in St. Paul, Minnesota, that makes cardiac rhythm management devices. That warning letter resulted in the company being unable to win agency approvals for products produced by that facility over the past 16 months.
While the lifting of the warning letter allows the company to get FDA approval on devices made at the plant and receive approvals for certificates needed to market devices made at the plant overseas, the company still has a corporate-wide warning letter looming over its head. That warning letter prevents it from receiving FDA approvals for other new products.
The company-wide warning letter — only the third of its kind ever issued to a medical device company — was disclosed in January 2006 (Medical Device Daily, Jan. 30, 2006)
Annette Ruzicka, director of media relations for Boston Sci's CRM unit, said it is her understanding that since the CRM warning was issued to the Guidant facility prior to its acquisition by Boston Scientific, that unit is now free to go about business as usual.
"It's an outstanding warning letter to Guidant, now Boston Scientific CRM, so what it does is free up CRM products," Ruzicka told MDD. She added that she believes the CRM unit has "definitely turned a corner and the warning letter being resolved is a major proof point" of that.
The FDA found the company's St. Paul plant is now up to code during a November-December 2006 inspection. The same plant failed an inspection in late 2005, resulting in the agency issuing the company a warning letter that December (MDD, Dec. 28, 2005).
Boston Scientific acquired the plant from Guidant (Indianapolis) in early 2006 when it bought the company for $27.2 billion. The plant makes pacemakers and implantable cardioverter defibrillators.
In its disclosure on the FDA's CRM facility inspection in September 2005, Guidant had said that the agency noted "several observations of non-compliance, including an observation with commentary on two specific trends in its Insignia and Nexus families of pacemakers." In December 2005, the company said it had provided the agency with "a thorough written response to the observations," including steps taken to address them.
"We are very pleased with the FDA's conclusion," said Jim Tobin, president/CEO Boston Scientific in a company statement. "This achievement is the result of a lot of hard work by employees across our CRM organization. The improvements made to our CRM quality system demonstrate our ongoing commitment to deliver the highest quality products to physicians and the patients they serve."
The re-inspection included an assessment of Boston Scientific's implementation of quality system improvements in response to the warning letter. FDA inspectors noted no observations during the re-inspection.
Company spokesman Paul Donovan said Boston Scientific is still making "steady progress" in resolving its company-wide warning letter.
Bear Stearns med-tech analyst Rick Wise wrote in a research note that he view the resolution of the CRM warning letter as a positive for Boston Scientific since it removes that regulatory overhang and should allow the company to once again gain CRM approvals.
Wise said he sees this event as a positive for all the players in the U.S. ICD market, including Medtronic (Minneapolis) and St. Jude (St. Paul, Minnesota), despite bringing another competitor back to the fold. Anything "that reduces ICD–related controversies is a positive," he said. Additionally, he said that with all three companies "putting their shoulder to the wheel" and building patient referrals, the possibility of an ICD market rebound would seem a more tangible and realistic possibility.
He noted that the most recent new product update regarding new ICD product releases (Cognis, Teligen, and Vitality NXT ICDs, with wireless data connectivity) appears still on track for late 2007/early 2008.